The Insiders

Two Suffolk County judges violated court rules designed to promote transparency and limit cronyism while awarding at least $600,000 in fees and expenses to political power broker Gary Melius and a network of his associates, a Newsday investigation has found.

Suffolk Supreme Court Justice Thomas Whelan appointed Melius and his associates to serve as property managers or receivers, which are essentially temporary landlords, for at least three office complexes in foreclosure. In a fourth case, also involving a foreclosed commercial complex, Whelan handled the case before it moved to Suffolk Supreme Court Justice Emily Pines.

Judges have used the appointments as a way to dole out lucrative favors to political insiders and reward party leaders for their endorsements, leading to criticism of the system. State court officials in 2002 established new rules to end the patronage and unjustified payouts.

But in the cases involving Melius and his associates, Newsday found that Whelan and Pines presided over the type of abuses court rules were designed to stop. The judges approved questionable or improper payments to political insiders and then failed to abide by court rules in neglecting to report information to the state, effectively hiding the group’s activity from the public.

Melius and his associates made money on top of the fees awarded through court appointments by sometimes hiring their own businesses to do work for the office complexes, Newsday found.

Those who benefited financially from the court appointments include Melius, a major political donor and influential member of the Independence Party who owns Oheka Castle in Huntington; Melius’ daughter, Kelly, who has worked for her father as Oheka’s director of sales; Ronald Rosenberg, a former Independence Party committee candidate and Melius’ attorney; Steven Schlesinger, Nassau County Democratic Party attorney and one of Melius’ closest friends; and Mark Cuthbertson, a Huntington Town Board member whose largest individual donor is Melius.

Also involved was Melius’ former son-in-law, Richard Bellando, Oheka Castle’s chief operating officer. Despite state court rules that bar the heads of political parties from fiduciary appointments, Pines approved a $90,000 payout to Bellando, Nassau County’s Independence Party chief since 2011.

Newsday uncovered the court appointments during an examination of Melius’ business dealings that began after he survived a gunshot to the head in February. His assailant has not been caught.

Reporters reviewed thousands of court filings related to four office complexes handled by Melius and his associates since 2009 and interviewed dozens of individuals, including current and former judges, attorneys familiar with commercial foreclosures and tenants and vendors linked to the properties in question.

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